Little Big Man: Who is Dr Bryce Wilkinson – and why should we care?

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DR BRYCE WILKINSON can make a reasonable claim to have written the book that launched neoliberalism in New Zealand. The name of that book was Economic Management, and although its official author was the New Zealand Treasury, most historians agree that the book’s guiding intellect was Dr Wilkinson’s.

Economic Management knitted together, into what amounted to a detailed manifesto, a raft of radical economic measures that had been worked out in “Economics II” – described by Te Ara, The Encyclopaedia of New Zealand, as: “a think tank in the Treasury in the late 1970s and early 1980s.”

Economics II was staffed by young economists who had studied at universities in the United States where the monetarist theories of Milton Friedman, and the ideas of neo-classical economics generally, were already well-entrenched. Along with Dr Wilkinson, Treasury’s “think tank” included Graeme Scott, Rod Deane and Roger Kerr – individuals who would go on to play pivotal roles in the execution and consolidation of the neoliberal order in New Zealand.

When the Labour Party was swept into office at the snap election of 1984, Economic Management was waiting for them.

“But, wait a minute!”, I hear you object, “Since when does Treasury supply New Zealand’s political parties with ready-made manifestoes? Didn’t Labour have a manifesto of its own in 1984?” Indeed it did – but not the sort of manifesto in which anyone could place much confidence.

Though the public were not told, Labour’s manifesto was a hastily-cobbled-together mish-mash of the policies advocated by Labour’s left-wing dominated Policy Council, and the ideas emanating from the faction in Labour’s caucus led by Roger Douglas and his fellow “reformers” Michael Bassett, Richard Prebble, Mike Moore and David Caygill.

So extreme were the ideas of Douglas’s faction, and so hostile to Labour’s traditions, that a new faction was summoned into existence to fight them. By May of 1984, this latter group was circulating a document posing a radical left-wing alternative to the right-wing measures being fed directly to Douglas and his followers by their special Treasury adviser, Doug Anthony.

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Had the Prime Minister, Sir Robert Muldoon, fearing a loss of his parliamentary majority, not called an early election on the night of 14 June 1984, it is fascinating to speculate as to which of these two, diametrically opposed, factions would have triumphed. An election held at the usual time, in November 1984, would have given Labour four more months (and an annual conference) to decide its future direction. Denied that time, the contending factions were persuaded to let David Lange’s deputy, the former Law Professor, Geoffrey Palmer, compose a manifesto both sides could live with, but which, as a reliable guide to the party’s future conduct in government, was next to useless.

Labour’s Bastille Day victory ceded the political initiative to Douglas’s faction. That the country was said by the Reserve Bank and Treasury to be in the grip of a “financial crisis” contributed hugely to the Right’s ability to control the course of events. Precipitated by a policy paper outlining Douglas’s determination to devalue the NZ dollar by 20 percent (which somehow ended up in the hands of the news media), the “financial crisis”, and the new government’s decisive handling of it, brought the Left/Right policy debate to an abrupt (if only temporary) end. It would be Dr Wilkinson’s Economic Management which set the course for what would later be called “Rogernomics”.

Readers of The Daily Blog born after those heady days in 1984, and thus played no part in the great struggle for Labour’s heart and soul that raged from July 1984 until the ejection of Mike Moore from – and the elevation of Helen Clark to – the leadership of the Labour Party in 1993, have been supplied with this brief sketch of the role Dr Wilkinson has played in New Zealand’s recent history, so that they can put his statement on foreign investment and racism, released earlier today (17/8/15) into some kind of context.

Commenting on the KPMG report showing China to be only the second-largest foreign investor (after Canada) in New Zealand (excluding residential property) Dr Williamson is reported as saying that “the report tackled many New Zealanders’ fears that China was buying up land, farms and businesses.” Anxiety about China was producing a “silly defensiveness” he said, adding that “racist attitudes and red tape were making New Zealand one of the most restrictive regimes in the world”. According to Dr Wilkinson: “We should be much freer and more open to the rest of the world and that helps New Zealanders get a better price for their assets which means they can invest more in the rest of the world themselves.”

More free and open! Such is the prescription of the man who, along with his colleagues from Economics II, persuaded the fourth Labour government to transform New Zealand into the most “free” and “open” economy on Earth. The man who urged on the sale of public assets to “foreign investors”, who were then free to repatriate the billions of dollars of profits extracted from them to their new owners offshore. The man who now calls those attempting to keep what remains of New Zealand’s assets out of foreign hands “racist”, but whose policy of preparing state-owned entities for privatisation saw tens-of-thousands of Maori forestry workers, railway workers and construction workers thrown out of their state jobs – leading to the disintegration of whole communities and the fracturing of whanau.

Small and unprepossessing, smiling his grandfatherly smile in the group photos of the New Zealand Initiative (successor to the now defunct Business Roundtable, which for many years was run by another alumnus from Economics II, Roger Kerr) Dr Wilkinson would be passed, unrecognised, in the street by 999 out of 1,000 New Zealanders. And yet, unelected, and largely unknown outside the neoliberal elite, this little man has left a very big impression on our country.

I’ll leave it for you, the reader, to decide whether it has been for good or ill.

 

104 COMMENTS

  1. It’s interesting how many utterly destructive neo-liberal ideologues in this country are kindly-looking elderly gents with twinkling eyes and grandfatherly smiles.

    • What?

      Kerr, Dean, Myers, Gibbs etc ???

      All have cold dead eyes as far as I can see.

      Douglas is an exception. Sharp beady eyes constantly darting around. Rat’s eyes.

      • Well, Kerr looked pretty benign, despite being a life-long cheerleader for neo-liberalism.

        Deane looked like a weasel-faced accountant. Wouldn’t trust that guy to sit the right way on a toilet seat.

        Myers and Gibbs, I’ll grant you, are graduates of the John Key school of smarmy obnoxiousness. I remember watching a film clip of Myers slyly stating ti camera, “The cheque book’s always open… for the right people.” What a git.

  2. Certainly rings a bell that name, not all pleasant though. RRRRRRINNNNG, here is the Master, with his RECIPE!

    NO, we have sold out, I have been shopping at the supermarkets, the goods we get from overseas, and I do like the odd European beer import, are excessively over-priced, as the oligopoly and monopoly traders and buyers get goods dirt cheap overseas (incl. clothing and so from China, Bangla Desh and elsewhere), but they have massive margins they put onto the price, which pay for their own and their shareholders Porsche, BMW, Mercs, Ferraris and Lexus and other “great” cars I see drive around Epsom, Parnell and Remuera or Newmarket every day.

    This is it then, “free trade”, good for some, stuff the jobs here, and we even bring in Mainland Chinese working for a bowl of rice to repair Kiwirail’s wrecked trains, and Philipino farm workers, desperate to get any jobs, same as their sisters, working in the homes for the elderly, at minimum or below wages.

    I think people can work it out themselves, yes I do. That is the workers, not the Remmers speculators, heavily into real estate at present.

    • Then you want to encourage greater competition and not more regulation (which just entrenches the Oligopolies)

          • Why would greater competition lead to less wages?
            If you don’t know the answer to that by now you will never know.

            • See my response below. I suspect you have never taken an Economics class in your life, or at least did not pass it if you did given your failure to understand the effects of increased competition in a market on demand for labour.

            • I’m well aware of the effects of supply and demand Frank. You need to think which side of the equation increased competition in a market has in regards to wages. I’ll give you a clue – It doesn’t impact the supply of labour and it will likely effect an increase on the area it does impact.

              • You’ve obviously swallowed the kool aid Gos. Your statements have zero bases in the reality of the New Zealand economy. Wages have been declining steadily for 30 years or New Zealanders would be buying more fresh produce.

                Analysing the role of rents in increases in inequality can be done with standard neoclassical models, expanding inputs to include land, but explaining increase in inequality as a result of an increase in other forms of monopoly rents will need a theory of rents which takes us beyond the competitive dilemma. Your a quack not a goose.

        • If you have more suppliers involved in a market you have less opportunities for oligopolies to be created. Oligopolies require a degree of collusion between suppliers that is hard to maintain the more players you have. Even left wing economists accept the logic of this.

          • Yeah right, Economics Gosmania 101, I suppose.

            In a small market like New Zealand (4.5 million population), that is not even the population of many global cities, there is little room for many players on the market, hence we tend to have oligopolies and monopolies.

            It is also common economic 101 that any market player will ideally want to achieve a dominant market position, being a monopoly, or at least an oligopoly, that is the natural aspiration of competing players. Beat your competition, take over large market share and then set the prices as you can get away with, whether exorbitant or not so.

            Also in a sophisticated economy, it brings with itself a certain degree of costs to run a competitive business. If the scale of economic activity is too small, this leads to inefficiencies.

            So we have some monopolies or oligopolies run grocery retail, building supply material business and much else. And also some overseas investors can bring capital that no New Zealand competitor may have.

            The only way to ensure reasonably fair competition, and to avoid monopolies and oligopolies is by using firm regulation, and there is again something, that I believe you will despise.

            Regulation and control, that is needed, but we get very little such regulation, that is under this government, which loves hands off management of the economy.

  3. Good point there Chris,

    I was overseas by 2007 in only came back with the old memories in 1998 and saw my Napier community ripped apart and many had lost their life time jobs and marriages, so bad was the results of this first round of Neo Liberalism that I have never gotten over the shock our family felt as we encountered the shock and distress we saw the impacts upon our community during these 11 yrs. of sheer slash & burn.

    Mindless wilful, disgraceful, destruction they committed upon our people.

    “Wilkinson” = “The man who now calls those attempting to keep what remains of New Zealand’s assets out of foreign hands “racist”, but whose policy of preparing state-owned entities for privatisation saw tens-of-thousands of Maori forestry workers, railway workers and construction workers thrown out of their state jobs – leading to the disintegration of whole communities and the fracturing of whanau.”

  4. So the answer to the question is Canada?

    But the question was, “who’s distorting the house prices in Auckland?” NOT “who’s invested across the full range of asset classes in NZ?”

    Stupid Media.

    • Canada has always played much more of a role in running New Zealand than perceived. Sort of the second brother engaged by the US and UK to run the junior kid brother innocent, tactifully and without letting on, providing Wellington with the central clues, while leaving the Beehive with the illusion they actually set policy. Given that Australia is a very different country from kiwiland with a different class settlement and an always much more private heath and educational system, and that from 1942 Australia modelled itself on European and US models while Wellington had little interest in moving from the British model, Australian direction of this society, was never likely to work and the substantial Canberra effort from about 1975 to 2008 to take the lead here, failed and has actually produced a more distant Canberra Wellington relationship.
      Ottawa and Toronto was largely were NZ post second world War defence, naval and intelligence policy was shaped and the blimpish colonels that apparently ran the SIS, GCSB and RNZAF in the past largely reflected the reality they were just sinecures and the real NZ intelligence centre was in Ottawa, Vancouver and Clark airfield. The recent revamp of the SIS and GCSB with staff and leadership that looks like the West Wing or Helen Mirren CIB reflects the fact after Snowden and the latest Canadian spy scandals we have to at least to pretend to have some local autonomy.
      You will also notice during the Shipley and Prentergast years the hotter bars and clubs were restaffed with gap year students from LA, Vegas and NY while under Clark and Key the voltage was subtly lowered to put Canadians on the desk. Under Celia Wade Brown the cafes often seemed staffed by mulleted work scheme males and inmates on day release.

  5. I felt a stab of recognition when I heard Wilkinson on RNZ yesterday afternoon, and then thought “not that guy again” and it all came back to me, the Joint Council of Labour abolished, FOL conference supporting ‘Rogernomics’ (by narrow majority) because of TINA, and all the other crimes small and large that added up to a nightmare that has still not ended

    • What errant nonsense. To show Treason has been committed you would have to show that someone deliberately and knowingly worked against the security interests of the nation.

      • Um…sorry to break it too you bud,…but NZ ‘s recent 35 year history is replete with examples of treasonous acts ….just because no one has died as a direct result doesn’t mean it hasn’t occurred…

        A recent example is two people dying in south Auckland homes- because of a low wage economy that means so many cant even afford to keep their family’s warm – or put decent bloody food on the table.

        Got to love that Employment Contracts Act , don’t you , idiot ?

        Or we could go on and talk about 29 men dying in the Pike River mine – why ?…because successive neo liberal govts are soft on business enabling them to take short cuts – at the cost of workers lives. Whereas formerly union mines inspectors would have closed that mine down so fast it would’ve made the CEO’s heads spin.

        You like social malaise and malfunction , idiot?

        How about those demonstrations against the TTPA ? – you think that’s all the people ? Your dreaming mate.

        That is only the tip of the iceberg of public resentment over that and this treasonous little man Mr key.

        New Zealanders are not that stupid and if you think you can come on here with your trite and droll one liner comments and convince anyone seriously – that being successively ripped off and shafted with 35 years of neo liberalism – with not infrequent deadly results- then buddy your more of a Key’s cheeks lover than you first appeared.

      • Wouldn’t be hard to prove. Jesson did a good job of chronicling the dodgy dealings of Douglas, Caygill, Prebble etc. Also Ian Wishart’s Daylight Robbery on the sale of the BNZ has some fabulous data. The info is out there Gossie. Dickheads like you are too blind to seek it just cos it don’t fit with your idiotic world view. Don’t mean the proof doesn’t exist. Hence Key’s focus on the media and how much gets out there. And no I am not a paranoid git. I have old friends who work in the Prime Minister’s dept and do this shit for a living.

            • No. That assumes the people who I memento these policies knew it would lead to a negative situation that you describe. You have no evidence this is the case.

              • Guile and deceit , Gosman .

                There is no way to prove either until something breaks and the whistle-blower leaks the goods.

                But that doesn’t mean to say treasonous intent and design haven’t been at work.

                Such is the case regards the neo liberal agenda in this country.

                And you know it.

      • Selling your own citizenry down the river for the benefit of foreign multi-nationals isn’t treasonous is it, Gossie? It’s just good business. Hooray for free market capitalism! Making a select few obscenely wealthy at the expense of everyone else since forever.

        • Except that is a value laden judgement that would be impossible to prove in any court of law. I accept that you don’t think foreign investment benefits New Zealand. I think you are wrong but I accept you hold that view. What you can’t seem to accept is that lots of people hold the contrary view. Hence what you think is evidence of someone deliberately screwing the country they think is actually helping the nation grow economically. That is why the call for people to be charged with Treason is nonsense.

            • Wow. Is that the best response you can come up with? How about you address the thrust of my argument. None of the people involved in reforming the NZ economy can be charged with treason because what they did doesn’t fit the text book definition of that term.

              • Neither does piracy on the high seas – but still it is crime.

                However what those people did was relocate vast sums of the public wealth offshore or into their own banks – by using grey areas of the law to do so.

                Drug cartels do the same. Its called money laundering in that case.

                In both cases it relies on guile, stealth and deception .

                The fact that it was carried out dubiously – using the barest of legal covering – but more importantly through lies and deceit changes not the end result.

                It damaged this country irreparably and that is treasonous if it was the deliberate intent of those people to create the conditions whereby the public wealth could be appropriated into their wealth.

                So not only is it treasonous – it is also theft of the public purse – of which both are criminal activities.

                Your standing on the thin edge of the wedge when you try to defend the neo liberal agenda , my friend.

  6. They perhaps should all be strung up on trees in the Auckland Domain!

    Treason I think they used to call it in the olden days.

  7. @ Chris Trotter. Without you and your erudite kind ? I’d a been none the wiser. My enemy comes into ever sharper focus. All our collective pain and uncertainty has its origins in a plain little creature with a silly hairstyle.
    Where does he live ? Where does he work ? What are his interests ? Who are his friends ? Who is his family ?
    Who else is asking these questions ?

  8. New Zealanders can consider themselves very lucky indeed that Roger Douglas and his associates interceded in the financial affairs of the country when they did. If they hadn’t, this place would have become a third world basket case.

    At the time NZ was facing economic collapse thanks to the Isolationist /Socialist policies it had pursued for decades. Essentially a one crop economy on the brink, to the extent that treasury was concerned they couldn’t even afford to pay the following month’s state salaries. They had no forex left and all the state sector industries were running at a loss as well as providing appalling service to their customers.

    Sure there was social upheaval but it has to be borne in mind that the jobs that went were economically unsustainable: Nobody wanted our wool & mutton at the time. They would have gone eventually anyway, but at least Roger Douglas prevented total chaos ensuing.

    It was the same in the UK before Thatcher. Sure jobs were lost under Thatcher but they were in industries which were for ever being propped up by infusions of cash from the tax payer. Just as with NZ the nationalized industries were running enormous losses and something simply had to change.

    As Maggie said and the Greeks have only just figured out: Socialism is fine until you run out of other peoples money.

    • As most of the world is finding out
      ‘Capitalism is fine -as long as you can keep printing money.’

      So which is worse Andrew -printing money or borrowing interest bearing printed money?
      Spouting your black v white ideology is all very well -but the rest of us live in the real world.

    • Couldn’t have said it better myself. NZ threw out a National Govt with interventionist policies and elected a Labour Govt with free market ones. Those were great times to be alive!

    • “Socialism is fine until you run out of other peoples money”

      Capitalism is fine until you run off with other peoples money

    • What an absolute load of shite where did you do your Economics Degree, Otara Kindergarten. I suppose you have got a Masters Degree with Honours?

    • The fact that Roger Douglas remains un hung-drawn-and-quartered is an instance of the unusual generosity of his countrymen. When their children begin to starve however they may be obliged to revise that generosity. 300 000 have food insecurity now – that means that it affects pretty much all the lower class and an increasing number of the middle.

      • I have a dream … That Roger Douglas’s grave site will become NZ’s largest (and most used) open air urinal!

        • Posterity will ne’er survey

          A nobler grave than this:

          Here lie the bones of Castlereagh:

          Stop, traveller, and piss.

    • What utter bullocks. No one wants our whole milk powder now so in that case shall we sell of off to overseas investors for a song, like the good ol’ ’80’s?

      Banks are and were propped up by massive infusions of taxpayer money or did you miss the GFC? Since when is that acceptable?

    • Hey……I was living in the uk under the grocer’s daughter and although I was fortunate to be in full time employ many of my friends became not only unemployed and homeless, but their marriages and relationships were torn apart by her policies. She deliberately destroyed what was a sunset industry ….coal mining………..sending tens of thousands of hard working people out of work and destroying their communities…….and had no policies to replace it….much the same in nz. Interestingly, she also wanted to get rid of social hohsing andthe result of that was housing benefits rose 6 fold as the taxpayer ended up paying huge amounts to private landlords in housing benefits. The only way the working person has achieved any real benefits has been under a socialist government……..end of story…….remember ….when Britain was the most powerful and wealthiest country in the world…..children were being sent up chimneys and the only alternative to working in service for single women was generally prostitution…….all good to have a rich nation but only if the whole nation benefits……..happy to have a discussion of the Thatcher experience……anytime.

  9. There are plenty of people around who remember the devastation of countless people’s lives post-1984. For thousands there was nothing except the dole and hollow government offers of “retraining” for non-existent jobs. I don’t suppose Dr Wilkinson has ever known that dreadful pit-of-the-stomach feeling when your job disappears and there are no prospects of finding another one.

  10. ‘ Small and unprepossessing, smiling his grandfatherly smile in the group photos of the New Zealand Initiative (successor to the now defunct Business Roundtable, which for many years was run by another alumnus from Economics II, Roger Kerr) Dr Wilkinson would be passed, unrecognised, in the street by 999 out of 1,000 New Zealanders. And yet, unelected, and largely unknown outside the neoliberal elite, this little man has left a very big impression on our country. ‘

    Yes….tapeworms as a pathogen are often not recognized in animals until they start to lose general condition as well…the same can be said about this country New Zealand…

    And the vector for creating these appalling conditions could also be described as such.

    When you think of neo liberals….think parasites, …think tapeworms, viruses , leeches , amoebas …and you will be thinking along the right lines.

    And just because a vector does not have a biological origin but an ideological one instead does not make it any less a pathogenic parasite by any chalk.

    And just as the parasite sucks the blood or leeches nutrients from its host – so too also does the neo liberal.

    And this is exactly what has happened to this country post 1984.

  11. ‘ New Zealanders can consider themselves very lucky indeed that Roger Douglas and his associates interceded in the financial affairs of the country when they did. If they hadn’t, this place would have become a third world basket case. ‘

    Heres another one like Gosshite who never ventures to south Auckland , west Auckland –

    Have you bothered to look around at provincial NZ or see the effects of a low wage economy on thousands of family’s?

    Are you new to New Zealand? Did you just get off a plane 6 years ago and know nothing of NZ’s recent 35 year history ?

    Are you a sycophant ?

    Do you have a grotesque sense of personal self entitlement ?…or do you simply have shares with those SOE’s that were plundered and divied up with local and foreign investors?

    The SOE’s that generations of NZ people payed for with their taxes to ensure fairness and prevent price gouging?

    Are you some sort of arsehole? – because I can tell you this buddy : There are thousands of people right now who are living in what we could call third world conditions and poverty .

    And don’t even try to talk about relative poverty bud – we are now talking real poverty.

    You sound like another one with his jowls up Mr keys cheeks.

  12. ANDREWO

    You are so blinded by your NatZ spin you don’t make any sense man!
    We have lost much during the Rogernomics era that is why we went down the gurgler, with loss of our first farmland to Foreigners of 650 000 hectares of prime pastoral farmland during 1984 and 92, one eight of our best most productive land then.

    Since 2008 this NatZ mob have just allowed a selloff of anther 550 000 Hectares.

    So we only had 4 Million Hectares of prime Pasture flat land to farm off of, except for increasingly more is in hilly difficult areas profitable or efficient to work.

    How are we going to not become tenants inn our own land now ?

    We are over the tipping point now with a third of our land gone to overseas investors and you still think we should sell the lot now too?

    • Where did this land go because last time I checked we have basically the same amount of land in NZ than we did in 1984.

        • Only if they make a profit. The Krafer farms made a huge loss yet there was still objection to them being sold to a Chinese based company. Why would you object to a Chinese company buying a farm that made a loss?

          • Because economic activity greatly exceeds the profit to be derived from time to time. Crafar might have employed thirty or forty New Zealanders and supported as many families to the great benefit of the community without returning a cent to the Aussie banks.

            Really Gosman – you hold yourself up as knowing something about economics – even you should know this.

  13. @ Cleangreen . I’m coming to the realisation that @ Andrew O , gasman etc are not in fact those odd buggers who get a frisson from being tied up, gagged and left in a gimp suit in a wardrobe for four hours while close to suffocation then pay a fortune for the privilege. There are very odd fellows out there and my suspicion is they get a thrill, an odd twitch in their sensitive little places, when they see how we loath them for their ignorances and gleeful support of brainless and cruel politics. We all know there’s plenty of wealth in NZ . We’re a farming country and there’s a starving world out there for Gods sake. We can’t go wrong. So, the only logical conclusion I can come to is in fact that the likes of @ Andrew , @ Andrewo , @ Gosman, @ Steve, @ Dan etc get a thrill at causing ructions within an innately pro-human Blog like this one. The best way to deflate the pressures within their barbed wire budgie smugglers is to ignore them completely. It’s very difficult I admit but unless we can get our hands on them, the next best thing to do is ignore them.
    In a nutshell, they’re baiting us then laughing at our attempts to round back at them. We’re being used for their humour and entertainment. Perhaps even as a resource. Who would know I suppose. Ignore them. They’ll soon grow tired of not getting attention and go off to find some hapless fly to pull its wings off. Anything for shits and giggles aye boys ?

    • True there Country Boy, I am over their antics so where were we?

      Of course Bryce Wilkinson the marvel of the universe Economist that believes we should sell the country to foreigners eh?????

      We are well and truly stuffed thinking like this cabbage head eh mate?

      Feed him to the wild pigs we have up in the Raukumaras.

  14. Hey, if you want to see how 1983 could have worked out, go visit Venezuela. 😉

    Whilst you’re all highly critical of Sir Roger & pals, none of you have even tried to outline a viable alternative path: If you’d been in charge at that moment what would you have done?

    I await your reasoned responses…

  15. I think John Key will be happy when we are tenants in our own country.

    When his time is up he will give us all the two fingered salute and fly off to his Hawaiian Retreat and live happily ever after playing golf with his mate Obama.

  16. I wondered who that nobody was last week lamenting complaints of selling more of this place off.

    My take on the reforms of the 80’s was largely one of a manufactured crisis to justify massive change for reasons that could easily be understood by the case of wealthy men being part of its planning, thereby having the inside running on what was to happen when their plans were implemented. They had seen the bonanza that such changes brought in the UK and the US and with the right person in control they were going to make shit loads. And its true, these influential wealthy citizens and their careful planning put them at the right place financially at the right time in history, a never to be repeated opportunity.

    New Zealand’s entire history of wealth creation for its people sold off for a song at a speed which prevented anyone doing a damned thing about it by a trusting nation who had not experience the shysters that were at work back then. It was a crazy make it up as you go game, Prebble as SOE minister even talked of privatising the Police!

    And the tax reforms that came with Douglas were as much longer term part of their wealth creation and preservation as any asset sale.

    I recall a number individuals became massively rich from participating (buying and selling) in the sell off of taxpayer owned assets and the deregulation of protected industries.A good few even got Knighthoods for their self centred ventures.

    Another plus for these reformers who profited was to see the government exit almost all walks of daily life leaving no state competitor to regulate pricing, a double whammy for the rest of us and a double dip for them.

    Where once we Kiwi’s made everyday things and had meaningful careers we now have low wage instability with gems like zero hour “flexibility” in the retail sales area and selling houses to each other or some foreign punter to scratch a living. Cheers Roger and friends, for nothing!

  17. The initial aim of Kerr, Wilkinson, Cameron and Deane was simply to reduce the cost of Government and the protected industries to what a small agricultural economy could afford. The 1930s era protection of internal car, biscuit and tv manufacturing no longer seemed very sensible.
    In terms of the railways the offerstaffing, poor quality of presentation and freight handling was legendary. Even many of the hard left was appalled by the stealing, breakages and losses in rail freight sheds, I think even Marilyn Waring expressed outrage as an MP at the situation and many hard left individuals even thought rail privatisation was acceptable in 1993. The temporary rail work gangs of derilicts presented an appalling picture to a country and rail management attempting to present rail trains as a tourist asset.
    Treasury in the late 1970s and 1980s, Roger Kerr was immensely opposed to expenditure on rail passenger services and indeed the purchase of any new comutter buses. Indeed during during the Douglas and Richardson years no new urban comutter buses were brought.
    Rail had long exhibited a shocking record of unnecessary and wasteful expenditure that increased debt. The Silver Star , 24 stainless steel carriages which carried 17 people and an army of cook stewards, was somesort of absurd prestige of the most uneconomical means of rail passenger conveyance possible. To preserve the profession of guards, Muldoon purchased 75 new guards van from Korea with 5 first class seats in each van. The electrification of the NIMT was somesort of illthought out energy saving gesture. If instead 40 modern Dash 8 or Dash 9 Diesels had been purchased from GE or GM, the economics and efficiency would have been much higher.

  18. Dr Wilkinson looks at such matters with the mentality of a bean counter. To bean counters, only a set of impressive figures marching across a piece of paper or a spreadsheet is important, nothing else really matters. People like this are not necessarily bad people, its just that the financial world of the elite is what they understand and not the real world of us joe bloggs’s.

  19. The Left have forgotten where we’ve come from:

    Meat pies and cold cups of tea in Taumarunui
    Waiting 3 months for a phone connection
    Buying a car, ‘fridge or TV only if you had foreign currency
    Spare parts shortages
    No brand choices in the shops
    Unaffordable overseas travel
    Rocketing inflation combined with a wage freeze
    Kiwis leaving in droves to Aussie

    Instead they remember sunny days at the batch they never owned but read about somewhere

    NZ was broke in ’83. I don’t know what the incoming Labour government expected at that first cabinet meeting but the Treasury presented them with a prediction of (if I recall correctly) 42% inflation within six months if nothing was done. The cupboard was bare.

    Sure the transition was imperfect and sure some people suffered and yes some people made huge profits on the gamble of buying state assets. But the alternative was the road to collapse.

    So you Lefties, sit in your Cuba street cafe sipping your elegant pinot gris typing class socialist slogans on your iphones. But don’t forget how far we’ve come.

    • Andrew – you forgot low unemployment; decent shoes that don’t fall apart after two months (or less!); free tertiary education, and houses that were affordable.

      As for claiming “Buying a car, ‘fridge or TV only if you had foreign currency” – is that pre or post WW2?! Because I grew up in the 1960s and 1970s and you’re talking bullshit.

      International overseas travel was not only affordable, but well used by young Kiwis from the ’60s onwards.

      As for ” Waiting 3 months for a phone connection” – now you’re just indulging in fantasies. The most I ever waited was three weeks (i bought my first house in 1978) and it was usually connected during settlement, so it was up and running by the time you moved in.

      By comparison, this is how long people are waiting for current internet connections; http://www.stuff.co.nz/technology/digital-living/9071784/Hundreds-of-households-waiting-for-broadband

      You were saying?

      Andrew, you really are utterly clueless when you have to make up rubbish like this.

      The only bit that’s half-way accurate was “rocketing inflation combined with a wage freeze” – and that was caused by the two oil shocks of the 1970s – especially the latter, which sent inflation soaring.(Ironically, the wage freeze was implemented by a National government, not a Labour one. Do you really want me to provide a link?)

      Learn your history, boy. You’re making a fool of yourself.

      • Yeah sure Frank.

        I had immigrant friends who brought a new car and a fridge with them an were considered well off as a result. We were stuck with buying vastly overpriced local rubbish. Everything was restricted by import licence and a handful of families controlled key sectors.

        We may have had low unemployment but it was all off a sheep’s back and the day the British voted to join the EU in early 70’s, that game was up. NZ was a country living on borrowed money, unable to pay its way in the world.There was a persistent fiscal deficit, inflation was too high, the SOEs were inefficient and served themselves more than they served us.

        We had to change and were damned lucky Roger Douglas was there to lead it.

        Nobody here has been able to even suggest a viable alternative to what was done

        • I had immigrant friends who brought a new car and a fridge with them an were considered well off as a resu

          Andrew your comment from your 6.45 post (above) is at variance with your silly assertion from your 5.45 post (below).

          Buying a car, ‘fridge or TV only if you had foreign currency

          Your really should check your facts before committing pixels to page. Otherwise you just end up looking silly.

          As for your hero, Roger Douglas – the Soviets had their cult-heroes as well. Dogma loves that sort of stuff. Neo-liberalism is not much different – just more consumer shit to buy.

      • lets not forget the nats destroyed the Norman kirk saving scheme that meant this country would have had hundreds of billion-of dollars in capital today,

        i was 14 in 1984 i remember roger Douglas saying we would be dancing in the streets in 10 years time all the damage thats been done for what 2015
        the country is broke again this time with no assets well this time the bastards in national should not be allowed to walk away or enjoy there retirement when they ruined the lifes and futures of so many people

        • lets not forget the nats destroyed the Norman kirk saving scheme that meant this country would have had hundreds of billion-of dollars in capital today,

          Never forget it.

          Perhaps the single greatest act of fiscal vandalism this country ever experienced.

      • Indeed, Xray. The only reason many are returning is rising unemployment affecting ex-pat kiwis. With no social welfare available, their choice is either starve or come home.

        Not exactly a glowing endorsement of the Key regime.

        • It was Helen Clark who threw away New Zealanders rights in Australia.

          Lucky for those returning that the National government has managed to maintain the NZ economy despite the difficult conditions globally.

          • Go talk to the Anglican and Presbyterian social support agencies and those who run the food banks clown – there’s your bloody neo liberalism for you !!!

            Go talk to those who cant feed their family’s or provide a decent damn meal foe them- there’s your precious neo liberalism for you idiot.

            Go talk to those who have to live week to week in poverty on a bullshit low wage – there’s your crap neo liberalism for you fool.

            Neo liberalism is just another word for economic rapists and plunderer’s.

            And as for your lame words regarding Clarke- anyone – anyone ! – who gives tacit approval to neo liberal economics and its theft of the public purse is as bad as the next one.

            This isn’t about any one party or any one individual – its about the thugs who perpetuate this treasonous anti democratic ideology.

            THAT’S what THIS is all about .

        • If that was the case then surely the number on welfare would be rising along with the returning Kiwi’s. Instead the numbers on welfare are falling.

          • Of course they’re bloody dropping!! Don’t be so obtuse, Gosman.

            They’re dropping because the system has been made more complex, with more hurdles, and a shitload of forms to fill out. People are being pushed of welfare for the flimsiest of reasons.

            It has nothing to do with job creation.

            Expecting us to believe National’s propaganda is one thing. But if you believe it yourself, then you really are living in a sheltered LaLaLand.

    • Bit of exaggeration Andrew. The mean and pie bunfights at rail refreshment rooms were replaced by massively extravagent on train catering and buffet cars in the mid 1970’s. Foreign currency was a great help in buying Australian Holdens and Falcons new in the 1960’s but by the 1970’s cars were available with just kiwi money, although some of the working class and young workers couldnt afford them until the Jap imports about 1986.
      However NZ and Wellington was a stalanist country before about 1982 in many ways, with virtually no modern style bars or cafes and not even coffee espresso machines which were banned by trade and industry and Muldoon as an unnecessary extravagance.
      There was massive unemployment in Muldoons New Zealand, much of it disguised in high and low paying government scheme PEP schemes. Unemployed graduates were given tempororary jobs at full public service rates with all the extras while the working class PEP jobs were menial and low paid.
      Nevertheless people like Kerr and Wilkinson for good and evil did have great influence over Muldoon and there was massive cutbacks in graduate intakes into the public service from about 1977/8 and in many cases notably in Transport and Trade and Industry, only those with strong economics qualifications were wanted. Also Muldoon was not particularly sympathetic to railways, passenger services were massivley cut back and rail was opened up first to competition up to 150km in about 1977 ans fully deregulated for open competition with road transport and buses in 1983 with annual rail loses of about $300 million

  20. Chris, are you A)implying that the 1984 devaluation was unnecessary? Wasn’t there an ongoing push for almost a year before Labour won, with the % devalue continuing to rise from 10 to 15 to finally 20%?
    Also B) that Roger Douglas had been publishing alternative budgets for a number of years as well as publishing papers, so anyone who could be bothered to read a little before they voted would have had no illusions. I find this myth, which I myself believed for a number of years, that Douglas tricked us all, to be not at all factually accurate.
    You also wonder what would have occurred if the 1984 election had have occurred later in the year…. would it be possible to ask some economists to crunch the numbers? What would have happened if the NZ$ had remained fixed for another few months. Would we have had much of an economy for Labour to have turned left or right?

    • Exactly right Brendon.

      I’ve spoken with two individuals who were in that first Labour cabinet meeting and both record the same facts: They were like a possum in the headlights of a oncoming financial collapse and only Roger & pals had any idea of a solution.

    • True to an extent, Muldoon’s regime was so stifling and divisive in character any change to liberate it was broadly welcomed.

      Even I cheered the reforms of the new Labour Govt on for most of it’s first term. I only realised Douglas was truly insane when he mooted flat tax and then I realised he was an economic traitor to the commons when the SOE sell offs began.

      Forming SOEs is one thing, selling them to the private sector was something else altogether.

      I think it safe to say that most NZers were unaware of the real extent of Douglas’s intentions.

      • I agree that “most NZers were unaware” but I’d be willing to argue that point about EVERY POLICY of every party at every election. Sadly that’s on us as voters and citizens. We’d all be better off if we got a little more knowledgeable about macroeconomics and policy.
        I’d be really interested in a left economic description of what could have been… an alternative to the Douglas programme, which actually crunches the numbers… if anyone knows of a book/essay that breaks this down I’d be really interested in reading it.

  21. The likes of Sir Ron Brierley, Sir Michael Fay & David Richwhite, Alan Gibbs & Co made huge profits through the privatisation of State Assets, sold to them for a pittance by extremely naive Governments.

    We as taxpayers were the ultimate losers.

    BNZ and Telecom were a couple of classics.

    • extremely naive Governments.

      They weren’t naive, they were knowingly complicit in the theft.

    • They only paid a pittance with hindsight.

      At the time it was a risky move to invest in a seemingly moribund SOE that was bleeding cash from all its orifices.

      Few knew how the miracle of private ownership would turn those organisations around so effectively.

      • Andrew, what a funny little fellow you are..

        You probably buy into the bullshit that privatising Telecom led to improved services.

        Here’s a history lesson for you.

        By the mid 1980s telecomunication in NZ was on the cusp or conversion from analogue to digital. The Post Office and the SOE Telecom had largely completed -and paid for – all necessary and preparatory groundwork.

        it was this change that brought the obvious improvements to customer services in the late 1980s and later.

        Nothing to do with privatisation.

        Mad Dog Prebble’s claims to the contrary are lies, pure simple lies.

  22. The “Mantra” that has been ignored and forgotten in must be shouted loudly and constantly is “Fair Trade!”

    “Free Trade” is the propaganda espoused by capitalist transnational corporations to justify maximizing profits from trade with countries with total disregard for human rights.

    There is nothing “free” for the workers in these countries where they are to not “free” to fight for anything more than a subsistence income and appalling working conditions.

    Capitalist behaviour has no moral basis and proponents are advocates of “free trade” or any other “activity” which maximize profit.

    This includes trade with Communist countries which they once sought to overthrow, dictatorships, countries utilizing child labour, trade with any country or group as long as it maximizes profit.

    This “free trade” has the effect of driving down wages and living standards and increasing inequality in our country.

    Democracy is an impediment to unfettered capitalism and therefore advocates of “free trade” attempt to hinder, control, or bypass democratic controls.

    Activities such as this which seek to undermine a nations economy are treasonous.

    The activities of individuals such as Dr Bryce Wilkinson fit this definition.

    They should be publicly outed and held to account as much as possible for their contribution to falling living standards and rising inequality in our country.

    • Trade is an impediment to nationalism, not democracy.

      Whilst it may have increased inequality WITHIN countries, it has decreased inequality BETWEEN countries.

      Don’t you care for your fellow global citizen? 😉

      When China opened up, it increased the global labour pool by about 50%. Rightly or wrongly, that was the end of western labour hegemony.

      Did I say life was fair?

      Little New Zealand is a minnow in the economic ocean and somehow or other we have to deal with that reality and the only realist way to do that is to stay sharp, work hard and look for every opportunity that presents itself. That way we may survive and maybe even prosper.

      Once again – you’re all just whining. I ask any of you to propose a viable alternative to what we have now.

      • Sonny – your a stuck record and if you had been paying attention over the last year or so you’ve been hanging around here you would have had your answer.

        But because of your obvious blind bias to neo liberalism – like most of them – you have made yourself totally unteachable. Not that I or others believed you really wanted an answer to begin with – just a place to air your pet ideology’s.

  23. 1000% Bob, & chris,

    Capitalism is this=

    If you’ve dabbled in the markets or tried your hand at investing in recent years, you’ve most likely heard the term “derivative” tossed around.

    Maybe you’ve heard money managers use the word to describe options based on assets such as stocks, while financial publications dive into the use of credit default swaps when writing about the 2008 financial crisis.

    The rest of us, however, are often left on the outside of these conversations, not quite sure what derivatives are or how they might affect us just know that CNBC the hallmark of Capitalism greed is spinning the lies all the time about a “Bull market” when today the bell weather stock they measure the economy with is posting yet another drop in profits so the CNBC spin doctors are telling the investors to foolishly invest???

    Derivatives are the only imaginary thread holding this failing economy up now, so get ready for the second major correction this century about to hit, as NatZ bare now about to flog off Kiwirail, Landcorp, and solid energy.

    Welcome to Planet Key’s failed capitalist world.

    http://theeconomiccollapseblog.com/archives/tag/stock-market-crash-of-2015

    • I suspect you don’t really know what Derivatives are beyond the ideologically biased articles you read on the subject. Derivatives in of themselves are merely a means of managing risk. They are not inherently bad or good.

      • Oh really? So they played no part in recent debacles like the sub prime crisis? You shouldn’t lie so much Gosman – it destroys your pretence of plausibility.

  24. Despite two requests by me on this thread, none of you have been capable of outlining a viable alternative to the 1980’s economic reforms.

    That’s the problem here: Lots of complaining and hating but no viable alternatives are ever presented.

    • I didn’t realise that the blog revolved around answering your questions Andrew. There were many alternatives to the free market revolution conducted by Rodger Douglas, many academics and critical thinkers have articulated those, I’m not sure why demanding a remedial lesson in alternative left wing theories needs answering.

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